The decision is meant to support Egyptian farmers, stated Mohamed El-Homosany, the cabinet spokesperson, on Wednesday.

Egypt has been adopting a series of measures to encourage farmers to sell more wheat to the government. The goal is to increase local production amid the disruption in the food supply chain caused by the Russia-Ukraine war.

In November 2023, the government increased the procurement price by 6.6 percent to EGP 1,600, up from EGP 1,500. The step followed the rolling of a package of incentives for farmers.

Egypt's annual wheat consumption is estimated at around 20 million tons, according to the Ministry of Supply and Internal Trade. 

Egypt produces nine million tons of wheat annually.

According to the UN Food and Agriculture Organisation (FAO), Egypt imports over 12 million tons of wheat – a figure likely to increase to more than 15 million tons by 2028.

A cabinet report stated that Egypt needs 7.7 million tons of wheat in 2024 to make 93.5 billion bread loaves, an Egyptian staple.

Unsubsidized bakeries decided to raise the price of a loaf of bread to EGP 2, up from EGP 1, in early 2024 as a result of fluctuations in dollar exchange rates.

In January, the Ministry of Supply and Internal Trade suspended trading in wheat in the Egyptian Mercantile Exchange (EME) due to price speculation in the local market.

At the time, Abdel-Ghaffar El-Salamouni, deputy head of the Chamber of Grain Production at the Federation of Egyptian Industries, denied a shortage in the domestic wheat supply, adding that the fluctuation in the exchange rate is among the reasons behind the price speculation. 

In 2023, Egypt's wheat imports amounted to around 10 million tons, 68 percent of which came from Russia. 

Egypt has been grappling with wheat shortage since the onset of the Russian-Ukrainian crisis in 2022. About 80 percent of Egypt's imported wheat comes from Russia and Ukraine.